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Paid trustees and unitary boards are wholly inappropriate

Paid trustees and unitary boards are wholly inappropriate
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Paid trustees and unitary boards are wholly inappropriate3

Governance | Dorothy Dalton | 11 Jan 2010

Is the time right for paid trustees and unitary boards? Dorothy Dalton reports.

Money is short. Charities labour to make ends meet. Trustees struggle with the dilemma of cutting core costs or axing frontline services.

The reputation of unitary boards has been tarnished by the failure of paid non-executive directors of banks to control the excessive risk-taking of their executive who, with them, are directors of the company.

Sir Richard Greenbury, who championed the unitary board against executive excesses, has changed his mind and is advising large companies to introduce the two tier board i.e. a separate board consisting purely of non-executive directors to whom the executive board is accountable.

NHS boards have long had unitary boards with paid non-executives. Nevertheless Mid-Staffordshire Hospital and Basildon University Hospital have hit the headlines because of poor hygiene and medical practices putting lives at risk. Many non-executives of NHS trusts complain that decision-making is dominated by the executive with non-executives neglecting to scrutinise major proposals properly and failing to monitor performance.

Not a time, you might think, for raising the issue of paying trustees for trustee services and introducing unitary boards. Not so. Kevin Carey, the new chair of RNIB, advocates both. Acevo has taken up the cause and launched the ironically named Progressive Governance Association. Progressive or regressive?

Presumably, not only will the association support paid trustees and unitary boards but also, Kevin Carey’s desire to concentrate on performance. Good governance consists of three key strands of governance- corporate/fiduciary, strategic and impact (governance September’07). As boards, we must do all three equally well while holding our executive to account (and supporting them).

If the very large charities want unitary boards and paid trustees then let them have them as long as they do so purely in the interests of their beneficiaries and not in the interests of their trustees or executive.

All we ask is that they stop trying to impose on others their model of governance on the grounds of good practice when most of us believe this model is wholly inappropriate.

Dorothy Dalton is the editor of governance

 

C Allen
none
none
23 Jan 2010

* Paying trustees ... not a question of timing as times changes, in the sense of the drivers change

* Too many of the consultants that advise charities on governance do so badly for a variety of reasons e.g. untrained, unthinking or fixed in a specific school of thought

* Many Trustees are long serving. Many chief executives are either self-serving or will depart for green pastures. This is but another concern with having a unitary board

* Are charities that live on delivering public sector services still charities? In this instance what is governance needs to be reconsidered

* The professional class in England is large enough to support a tradition of volunteer trustees. My view is that more than enough professionals will agree to serve, once in their lifetime, a voluntary four year term

* Many Trustees serve who have no degrees but are professional in the approach. Sadly, much not-fit-for-purpose training is given to these trustees

* In most instances, it seems the existing cultural network of Trustees would permit only a token minority of non-networked professionals in the loop once paid trustees become a normal option

* The regulatory environment does not exist to temper a norm of paid trustees. Question is that those who joyfully talk of paid trustees are making no or little mention of avoiding the good, bad and ugly of such a norm. This is significant cause for alarm

I have a vague uneasiness ...something about a banker doing god's work http://www.timesonline.co.uk/tol/news/world/us_and_americas/article6907681.ece

Jay Kennedy
Policy Officer
Directory of Social Change
22 Jan 2010

Bravo Dorothy for making the case against paying trustees - it's a bad idea for all kinds of reasons, and not supported by the vast majority of charities in my opinion. The fact that even if charities have paid staff they are governed by volunteers is a crucial principle of what charities are all about, which we abandon at our peril. The premise that people who are paid inherently do a better job than those who volunteer is just simply not true - if it were, why should we bother with a volunary sector or volunteers at all?

I disagree though that big charities should be allowed to go their own way. In fact I can't even believe we're still having this debate given the recent colossal governance failings in the private sector - the implications of which are set to put a stranglehold on our society and politics for years, if not a generation.

If big prestigious charities aren't able to attract the quality of trustees they need then offering cash is not going to solve their problems - it may even make them worse. The true reasons for their inability to get the people they need are likely to be much more complicated and uncomfortable.

John Marshall
CEO
Centrepoint Outreach
22 Jan 2010

I strongly object to the idea of paid trustees. They should continue to give their time as volunteers, who donate their varied skills and experience from their 'day jobs'.

Outside of my employment, I am valued as a volunteer with several local and national charitable organisations. No way do I need or want payment!

Raising money for a smaller charity is not easy. Our members do not want to see more spent on administrative & governance costs.

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